Don’t Worry About Another Market Crash

Here are the reasons you don’t need to worry about another market crash.
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The most common question I receive as a real estate agent is, “When is the market going to crash?” My clients are having flashbacks to 2008 when the market crashed and sent shockwaves through the economy. While no one can predict the future with 100% accuracy, I don’t think we’re heading for another crash. First off, it’s understandable for people to be worried. The market is on fire! Compared to this time last year, home prices are up 16%. In some markets, it’s even higher. This is a dramatic increase, but rising home prices aren’t necessarily an indicator of a crash. There are a lot of significant differences between our market and what was happening in 2008.

For example, lending practices are very different. You used to be able to get a loan just by stating your income. Plenty of people took advantage of this and ended up with a home they couldn’t afford. Lenders have stricter guidelines now, and all incomes are verified.

Our current market is driven by basic supply and demand.

In 2008, people were also overpaying for their homes because of adjustable-rate mortgages. Once the bubble popped, people were stuck with devalued homes they couldn’t afford, and this led directly to the wave of foreclosures that only exacerbated the problem. Unlike 2008, our current market is being driven by basic supply and demand. People were stuck inside their homes for over a year, so it’s only natural that all their pent-up demand is driving a hot market. Also, instead of shady lending practices, low interest rates are allowing people to afford pricier homes. When we combine this high demand with historically low supply, we end up with our current market. After the crash in 2008, builders were left with thousands of homes that no one wanted to buy, costing them a ton of money. They are much more cautious now about making sure they do not oversaturate the market with homes, and this is a big reason why we are seeing low supply. The bottom line is, I see this market continuing for at least eight to 10 months before we see a significant slowdown. If you want to take advantage of the market while you can, please give me a call at 717-695-3177 or email me at I look forward to hearing from you!